Exchange Rate Effects of Central Bank Interventions: An Analysis of Transaction Prices

Authors: Fischer, A. M.¹; Zurlinden, Mathias²

Source: The Economic Journal, Volume 109, Number 458, October 1999 , pp. 662-676(15)

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Abstract:

The impact of sterilised interventions by the Swiss National Bank on the Swiss franc/U.S. dollar exchange rate is examined for the 1986-94 period. The paper extends results from earlier studies by using the actual prices of interventions. Based on the fact that all Swiss National Bank interventions are announced, our test exploits the informational differences between interventions and customer transactions. A key finding is that only initial interventions matter; customer transactions and subsequent interventions have no influence.

Document Type: Original article

DOI: http://dx.doi.org/10.1111/1468-0297.00467

Affiliations: 1: Swiss National Bank, University of Bern, and CEPR, 2: Swiss National Bank

Publication date: 1999-10-01